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We study moral judgments regarding budgetary slack made by participants at the end of a participative budgeting experiment in which an expectation for a truthful budget was present. We find that participants who set budgets under a slack-inducing pay scheme, and therefore built relatively high...
Persistent link: https://www.econbiz.de/10013134393
Given traditional agency theory assumptions and unobservable effort in a single-period setting, a moral hazard arises in which the agent is expected to shirk and provide the miminal possible effort after contracting with the principal. Traditional solutions to this agency problem include paying...
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Researchers have questioned whether individual differences in moral reasoning might partly account for the variation in auditor misreporting behavior documented in prior experimental-markets research in auditing. In the first experimental market study to directly test the relation between moral...
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We argue that recent participative budgeting experiments designed to extend agency theory reveal the effects of responsibility, transparency, and accountability. We define these three theoretical constructs and present two experiments designed to isolate their main and interactive effects. In...
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While managers commonly possess private information regarding future production cost when developing their cost budget, they also face outcome uncertainty regarding that future cost. This outcome uncertainty, however, has largely been ignored by experimental researchers examining various...
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